Available for Interviews: Don Garman
Don Garman is the Founder and Chief Investment Officer of Mirador Capital Partners and Co-Founder of Tri-Valley Ventures. A seasoned investor in both public and private companies for over 30 years, Don leads Mirador’s Investment Committee and oversees each of the firm’s proprietary investment strategies.
What Don Garman can say in an interview:
For owners and entrepreneurs, usually their biggest concerns have to do with growing their business: building a network, strengthening client relationships, increasing profits, and so on. The idea of stepping away may not be on their minds, but it’s an important issue that requires owners to prepare. Here are a few questions to consider when thinking about selling your business.
1. When do you want to exit your company: immediately or far in the future?
The process of selling a business is measured in years, not months. It’s critical to consider your exit strategy before it gets too late and fewer options exist.
2. Which way of selling your company is your best option?
Generally, there are four ways to sell a business effectively. You can sell it to someone within the organization, sell it to someone outside the organization, sell it to the employees, or take all the money out of an organization before closing it down. This last method often applies to companies that would be difficult to sell because they rely on an individual’s unique skill set or personal reputation; for example, a small-to-mid-sized construction company might rely heavily on professional relationships that the owner developed over many years, and which cannot necessarily be “transferred” to anyone else.
3. What is your financial situation outside the business?
Owners who have done well throughout their career and who have all the money they desire usually have a larger number of options because they aren’t relying on what is often called the “exit magic number,” which refers to the amount of money an owner needs from a business to be able to step away. A related question to ask is, what risks should be addressed prior to an exit? For example, do you need to strengthen the business’ balance sheet so you can reduce your dependence on the company in the long term?
4. What is your life going to look like after selling your business?
This question isn’t one that owners usually think about. Often, retirement for many people might mean a romanticized vision of playing golf and traveling. But there are many Type A personalities who have worked night and day, nonstop, for years, to build a company that is suddenly no longer their responsibility. It’s one thing to have the financial means to handle the future, but it’s another thing to have the intellectual or spiritual means to handle what could be a jarring lifestyle change. Putting together the right team of financial planners, accountants, attorneys, and others around you to lend support and help you strategize is extremely valuable. The team will work with you to determine what can be received from selling your business and options to consider if that estimation will fall short of your goals. It’s important to know what you will receive before agreeing to sell, including what you will actually receive after taxes, because you’ll be trading away the major component of your income.
Don’t entertain any offers to purchase your business until you know what that offer needs to have; otherwise it’s possible to be left without enough money. Even if a deal falls through, it’s difficult to become enthused again about the day-to-day logistics of running a company once an owner has already explored the possibility of getting cashed out. It’s crucial that financial advisors be part of your team so they can put accurate numbers around your business before an offer, so when the offer arrives, you know you’ll be ready.
Interview: Don Garman
Don Garman has earned the prestigious designations of Certified Financial Planner® and Certified Investment Management Analyst®. Prior to founding Mirador, Don served his clients at two of the nation’s largest advisory firms. He is very active in the Tri-Valley area and supports many community organizations, including The First Tee of the Tri-Valley, The George Archer Foundation, and the Livermore Valley Wine Growers Foundation. He also serves as President of the Tri-Valley Cal (UC-Berkeley) Alumni Club. Don lives in Pleasanton with his wife Mindy and has two children, Emma (Georgetown University) and Scott (high school sophomore). He is an avid drummer, golfer, and snowboarder.
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